Correlation Between Capital Clean and SNDL
Can any of the company-specific risk be diversified away by investing in both Capital Clean and SNDL at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Capital Clean and SNDL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Capital Clean Energy and SNDL Inc, you can compare the effects of market volatilities on Capital Clean and SNDL and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Capital Clean with a short position of SNDL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Capital Clean and SNDL.
Diversification Opportunities for Capital Clean and SNDL
0.02 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Capital and SNDL is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding Capital Clean Energy and SNDL Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SNDL Inc and Capital Clean is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Capital Clean Energy are associated (or correlated) with SNDL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SNDL Inc has no effect on the direction of Capital Clean i.e., Capital Clean and SNDL go up and down completely randomly.
Pair Corralation between Capital Clean and SNDL
Given the investment horizon of 90 days Capital Clean Energy is expected to generate 0.34 times more return on investment than SNDL. However, Capital Clean Energy is 2.95 times less risky than SNDL. It trades about 0.04 of its potential returns per unit of risk. SNDL Inc is currently generating about -0.08 per unit of risk. If you would invest 1,862 in Capital Clean Energy on August 28, 2024 and sell it today you would earn a total of 18.00 from holding Capital Clean Energy or generate 0.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Capital Clean Energy vs. SNDL Inc
Performance |
| Timeline |
| Capital Clean Energy |
| SNDL Inc |
Capital Clean and SNDL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Capital Clean and SNDL
The main advantage of trading using opposite Capital Clean and SNDL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Capital Clean position performs unexpectedly, SNDL can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in SNDL will offset losses from the drop in SNDL's long position.| Capital Clean vs. Star Bulk Carriers | Capital Clean vs. TOP Ships | Capital Clean vs. Seanergy Maritime Holdings | Capital Clean vs. Performance Shipping |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
Other Complementary Tools
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets |